Legal Terms and Definitions Quiz

Questions and Answers

What is meant by 'regulation' according to the Act?

A notice given by the registrar

A code of conduct issued by the Board

A determination made by the Tribunal

A regulation made under section 35 (correct)

What is a 'regulatory authority'?

An entity established to regulate activities of an industry (correct)

An entity established to regulate the registrar

An entity established to regulate the Board

An entity established to regulate the Tribunal

Who is excluded from being a 'representative'?

A person who renders legal services in an administrative capacity

A person who renders clerical services in a subsidiary capacity (correct)

A person who renders a financial service to a client

A person who renders accounting services on behalf of a financial services provider

What is a 'rule' according to the Act?

A rule made by the Board under section 26 Signup and view all the answers

What is included in the definition of 'this Act'?

Regulations, rules, codes of conduct, notices, approvals, exemptions, and other decisions Signup and view all the answers

What is the 'Tribunal'?

The Financial Services Tribunal established in terms of section 219 of the Financial Sector Regulation Act Signup and view all the answers

What is exempt from the provisions of this Act?

Financial products exempted by the registrar by notice in the Gazette Signup and view all the answers

Who determines the exemption of financial products from the provisions of this Act?

The registrar Signup and view all the answers

What information must the register contain about each representative or key individual?

Their name and business address, and whether they act as an employee or mandatory Signup and view all the answers

What is the purpose of the registrar requiring information from the authorised financial services provider?

To maintain and continuously update a central register of all representatives and key individuals Signup and view all the answers

What happens to a person who complies with the requirements of this Act for a representative?

They are regarded as a representative for the purposes of this Act Signup and view all the answers

What is specified in the register about the representatives?

The categories in which they are competent to render financial services Signup and view all the answers

Who must maintain and continuously update the central register?

The registrar Signup and view all the answers

Where must the register be published?

In any appropriate media Signup and view all the answers

What can the registrar do if they believe a person is contravening a provision of this Act?

Direct the person to furnish specified information or documents Signup and view all the answers

What is the purpose of the registrar directing a person to appear before them?

To discuss the contravention and find a solution Signup and view all the answers

When can the registrar apply to a Court for an order?

If significant prejudice or damage to clients has occurred or may occur Signup and view all the answers

What can the registrar do if they believe a person has failed to comply with the Act?

Direct the person to furnish specified information or documents Signup and view all the answers

Which of the following banks are regulated by this Act in the code of conduct?

A bank as defined in the Banks Act, 1990 Signup and view all the answers

What can the registrar do if prejudice or damage may have occurred to a client?

Refer the matter to the Office Signup and view all the answers

What is the maximum term of a deposit referred to in paragraph (f) of the definition of 'financial product' in subsection (1)?

12 months Signup and view all the answers

What is the purpose of the registrar directing a person to furnish specified information or documents?

To obtain information related to the contravention Signup and view all the answers

What can the registrar do if they believe a person is contravening the Act?

Direct the person to make arrangements to discharge their obligations Signup and view all the answers

Who may determine that provisions of this Act do not apply to certain natural persons or groups?

The Minister Signup and view all the answers

What is the relationship between this Act and other laws?

This Act is in addition to other laws not inconsistent with its provisions Signup and view all the answers

What is the purpose of the registrar applying to a Court for an order?

To restrain the person from continuing business Signup and view all the answers

What happens when the context otherwise indicates?

The words and expressions have a different meaning ascribed to them in terms of the Financial Sector Regulation Act Signup and view all the answers

What is the effective date of the substitution of subsection (4) by s. 175 of Act 45/2013?

28 February 2014 Signup and view all the answers

What is the effective date of the insertion of subsection (7) by s. 290 of Act 9/2017?

1 April 2018 Signup and view all the answers

What is the reference in this Act to the Board or the registrar read as?

The Authority Signup and view all the answers

What is the primary goal of a code of conduct for financial services providers?

To ensure clients make informed decisions and their financial needs are satisfied Signup and view all the answers

What is expected of financial services providers regarding their professional activities?

To have and employ effective resources, procedures, and technological systems Signup and view all the answers

What should financial services providers do when dealing with client information?

Seek from clients appropriate and available information regarding their financial situations Signup and view all the answers

How should financial services providers handle conflicting interests with clients?

Act with circumspection and treat clients fairly Signup and view all the answers

What is a fundamental principle of a code of conduct for financial services providers?

To act honestly and fairly in the interests of clients Signup and view all the answers

What is expected of financial services providers regarding applicable laws and regulations?

To comply with all applicable statutory or common law requirements Signup and view all the answers

What should financial services providers do regarding client financial situations and objectives?

Seek from clients appropriate and available information regarding their financial situations and objectives Signup and view all the answers

What is expected of financial services providers in the conduct of their business?

To act with due skill, care, and diligence in the interests of clients Signup and view all the answers

Study Notes

Definitions

"Regulation" refers to a regulation made under section 35
"Regulatory authority" means an entity established in terms of national legislation responsible for regulating activities of an industry or sector of an industry
"Representative" means a person who renders a financial service to a client for or on behalf of a financial services provider, excluding persons rendering clerical, technical, administrative, legal, accounting or other services in a subsidiary or subordinate capacity
"Rule" means a rule made by the Board under section 26
"This Act" includes any regulation, rule or code of conduct, and any notice given, approval or exemption granted, determination made, requirement or condition determined or imposed, or any other decision referred to in section 3(1)
"Tribunal" means the Financial Services Tribunal established in terms of section 219 of the Financial Sector Regulation Act

Financial Products

A financial product does not include any financial product exempted from the provisions of this Act by the registrar by notice in the Gazette
The rendering of a financial service in respect of a deposit by a provider which is a bank, mutual bank, or co-operative bank is regulated by this Act in the code of conduct contemplated in section 15(2)(b)

Application of Act

Provisions of this Act relating to financial services providers, representatives, and product suppliers apply to any natural person or group of natural persons acting within the scope of their official duties in the employ of the State, or any organisational unit of the State, or any public entity
This Act must be construed as being in addition to any other law not inconsistent with its provisions and not as replacing any such law
Unless the context otherwise indicates, words and expressions not defined in subsection (1) have the same meaning ascribed to them in terms of the Financial Sector Regulation Act

Relationship between Act and Financial Sector Regulation Act

A reference in this Act to the Board or the registrar must be read as a reference to the Authority

Investigations and Enforcement

The registrar may direct a person to furnish information or documents, or to appear before the registrar, if there is reason to believe that the person is contravening or failing to comply with a provision of this Act
The registrar may apply to a Court for an order restraining a person from continuing business or dealing with funds or other property held on behalf of clients, if satisfied that significant prejudice or damage to clients has occurred or may occur
The registrar may refer a matter to the Office to be dealt with as a complaint by the client concerned

Register of Representatives and Key Individuals

The registrar must maintain a central register of all representatives and key individuals
The register must contain every representative's or key individual's name and business address, and state whether the representative acts for the provider as employee or as mandatory
The register must specify the categories in which representatives are competent to render financial services

Code of Conduct

A code of conduct must be drafted to ensure that clients are able to make informed decisions, and that their reasonable financial needs are appropriately and suitably satisfied
The code of conduct must ensure that authorised financial services providers, and their representatives, act honestly and fairly, and with due skill, care and diligence, in the interests of clients and the integrity of the financial services industry
The code of conduct must ensure that providers and representatives have and employ effectively the resources, procedures and appropriate technological systems for the proper performance of professional activities
The code of conduct must ensure that providers and representatives seek from clients appropriate and available information regarding their financial situations, financial product experience and objectives in connection with the financial service required
The code of conduct must ensure that providers and representatives act with circumspection and treat clients fairly in a situation of conflicting interests, and comply with all applicable statutory or common law requirements applicable to the conduct of business

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Test your knowledge of legal terms and definitions with this quiz, covering regulatory authorities, regulations, and more!